Rally Builds; Dow Up 10 to Set New Record

The Dow Jones average of 30 industrials rose 10.08 to close at 1,357.97, another record high. This brought its gain over the past two sessions to 22.51 points.

Turnover on the New York Stock Exchange reached 159.92 million shares, up from 132.50 million on Tuesday and the largest total since 170.02 million changed hands Jan. 30.

Reagan Recovering

Analysts said the market continued to benefit from reports that President Reagan was recovering quickly from surgery last weekend.

Traders also responded enthusiastically to word that the Federal Reserve had reset its targets for growth of the money supply from a new base. The move was taken as an indication that the Fed plans to stay with its recent relatively stimulative credit policy.

The staying power of the market's advance will be tested today, when the Commerce Department issues an updated figure on economic growth for the second quarter. The department's "flash" estimate reported in June put growth of the gross national product for the quarter at an inflation-adjusted annual rate of 3.1%.

Among NYSE-listed stocks, Federal Express climbed 2 7/8 to 50. The company reported Tuesday that its earnings for the fiscal quarter ended May 31 increased to 89 cents a share from 61 cents in the like period a year earlier.

IBM Advances

International Business Machines rose 7/8 to 129 3/8. The stock has been moving up since early this week, when IBM issued a quarterly report that many analysts interpreted as favorable for the company's outlook.